A polyester imitation cotton yarn-dyed fabric, and a manufacturing method and use therefor, pertaining to the technical field of textiles. The polyester imitation cotton yarn-dyed fabric is comprised of interwoven warp yarns and weft yarns. The warp yarn is core spun yarn in which dyed polyester is used as a cladding layer and low-temperature spandex is used as core yarn, the weight ratio of the polyester and the low-temperature spandex is 4-49:1, and the polyester forms a corroded surface by means of alkali weight reduction processing. The polyester imitation cotton yarn-dyed fabric has a good cotton feel, high elasticity, high color fastness and a low degree of ironing-induced shrinkage. The yarn-dyed fabric can be used in the manufacture of high-quality garments, especially in the manufacture of shirts. The manufacturing method for the yarn-dyed fabric conserves energy and reduces emissions, and produces a novel polyester yarn-dyed fabric having a low degree of ironing-induced shrinkage, high color fastness, and a feel that imitates that of cotton. The yarn-dyed fabric can be used in the manufacture of clothing such as shirts in order to increase the selectivity and functionality thereof.